PLED · Paid Leave Effects and Dynamics

This project investigates the long-term and distributional effects of paid leave (PL) policies—maternity leave (ML) and paternity leave (PTL)—on child development and family behavior. Motivated by Europe’s persistent fertility decline and widening early-life inequalities, the project develops a structural framework (PLED) to evaluate how PL reforms affect fertility, labor supply, and parental investment decisions over the life cycle, and how these effects vary across socio-economic groups.The first objective is to provide a comprehensive framework to estimate the long-term and distributional effects of ML policies. This will be achieved by building a life-cycle model (PLED1) that captures interdependent decisions on fertility, maternal labor supply (including ML uptake), and parental investment across stages of childhood. The model will quantify the direct and indirect effects of ML policies on children’s skill formation while accounting for household heterogeneity in income and education. Initially calibrated to U.S. data, it is designed to be adaptable for policy analysis across EU countries.The second objective is to provide a tool of analysis focused on the introduction of paternity leave. To achieve this, I will extend the model developed in PLED1 to account for earmarked PTL policies by modeling leave uptake decisions for both parents. This will result in a new model (PLED2), which allows the assessment of gender-egalitarian leave schemes and their effects on child outcomes and within-household wage dynamics.By combining theoretical modeling, empirical calibration, and policy evaluation, the project will generate flexible tools to support the design of more inclusive, effective family policies aligned with the EU’s strategic priorities on demographic sustainability and social equity.